Things to do with brands

This work is licensed under the Creative Commons | © Robert J. Foster. Attribution-NonCommercial-NoDerivs 3.0 Unported. ISSN 2049-1115 DOI: http://dx.doi.org/10.14318/hau3.1.003

Things to do with brands

Creating and calculating value

Robert J. FOSTER, University of Rochester

How is the dollar value of commercial brands calculated and marks of distinction thus paradoxically made commensurable? And what does this calculation assume and enact with regard to, in Marx’s terms, the creation of value and surplus value? I discuss the emergence of brand valuation as a market device that has recently become more prominent and standardized. I use the annual Interbrand/BusinessWeek survey to demon-strate how global brands such as Coca-Cola® are assigned a precisely measured monetary figure. This measurement invites brand managers and critical theorists alike to treat the heterogeneous uses to which consumers put brand-name products as a source of the exchange-value of brands and of risks to generating profits from brands.

Keywords: value creation, brands, gifts and commodities, consumption, The Coca-Cola Company

Questions of value

In September 2010, a relatively new market device acquired greater stability. The International Organization for Standardization (ISO) issued ISO 10668, a ten-page set of “requirements for monetary brand valuation.” The ISO, based in Switzerland and founded in 1947, describes itself as a “worldwide federation of national standards bodies” (2010: iv) representing 163 member countries. Through its various technical committees, the ISO promulgates global industrial and commercial standards. ISO 10668 gave credibility and legitimacy to the accounting procedure by which a monetary value is assigned to a brand.

ISO 10668 sought to bring internationally recognized order to the various methods for measuring the monetary value of brands that had proliferated since the 1980s in response to the increasing importance of “intangible assets” to the operations of many firms. It begins by observing that “intangible assets are recognized as highly valued properties. Arguably the most valuable but least understood intangible assets are brands. However, reliable values need to be placed on brands” (ISO 2010: v). This need occurs acutely when, for example, one company buys another company’s brands or a company tries to defend itself against a hostile takeover bid perceived to be below fair market price. Without brand valuation, it is difficult to say how much of a corporation’s market capitalization can be attributed to its brands (and to the work of the marketing department). In other words, brand valuation is a market device that diagnoses and remedies “the inability of market prices to reflect the real productive power and social value of an organisation and its resources” (Arvidsson 2009: 16).

Brands become important as sources of revenue when competition continually reduces the manufacturing cost of otherwise comparable products, a condition favored by the global availability of cheap labor and flexible offshore subcontracting. Brands also become important when labor takes the form of user-generated content, or prosumption, a possibility enabled by recent developments in digital technology. For example, consumers use such services as Facebook and Twitter without charge in order to produce the content that they consume also without charge; their labor is free—that is, both unpaid and voluntary. In such cases, the branded platform exists before the corporate brand owners have a product (e.g., personal data or audience attention) to sell at a profit. I suggest that there is something novel going on here—a historically particular way of converting use-values into exchange-value—while remaining skeptical about the emergence of a new economy of immaterial labor or a new prosumer phase in the evolution of capitalism (see Slater 2002; Land and Böhm 2009; cf. Ritzer and Jurgenson 2010; Arvidsson 2009). What is undeniable is that the growing importance of brands raises for different reasons the same two questions for marketing professionals, on the one hand, and students of contemporary political economy, on the other: How is the value of brands created? And how is the value of brands calculated?

These questions are hardly straightforward. The language of value, value creation, and value measurement (or valuation) permeates the discourse of marketing. Getting critical purchase on this language through social science theory and analysis poses a challenge inasmuch as this theory and analysis informs the work of marketing scholars and researchers—both critical and mainstream—whose writings in turn shape the managerial practices of marketing professionals. The loop connecting social theory and marketing practice, moreover, makes it hard to tell if everyone is indeed asking the same questions—a condition of uncertainty already guaranteed by the fertile polysemy of the word “value.”

Accordingly, my strategy here is first to present examples of how questions of value are currently framed and addressed in marketing discourse about brands. I focus in particular on how this discourse constructs the agency of consumers and how it imagines the process of value creation as a mutually satisfying partnership between brand users and brand managers. I take examples from ongoing research on The Coca-Cola Company (see Foster 2008a).

I then look elsewhere for resources to critique this celebratory discourse— namely, to Karl Marx’s ([1867] 1967) labor theory of value and Marcel Mauss’ ([1925] 1967) formulation of the gift. This critique requires a broadening of Marx’s theory to include consumption, on the one hand, and a softening of Mauss’ contrast between gifts and commodities, on the other. The resulting analysis enlists the classic anthropology of gift exchange in the service of understanding how the agency of brand users becomes a source of surplus value for brand owners (Foster 2008b). I conclude by pointing to the uncertain implications of this critique for a politics of consumption, certain forms of which are understandably dismissed as an apolitical liberal solution to the problems of neoliberalism (see, e.g., Hickel 2012).

Marketing discourse: Coca-Cola®, consumer agents, and co-creating value

YOUR CUSTOMERS. Engaged. Talking. Innovating.
Your customers hold tremendous value. Not simply through the money they spend, but forthe thinking they can contribute. Engage them in what you do—on an ongoing basis—and you'll be rewarded with powerful insights.

— Communispace, “Communispace, the leader in online consumer insights communities”

In a post to a blog hosted by the Harvard Business Review, Joe Tripodi (2011) identifies the changes that have redefined his role as chief marketing officer of The Coca-Cola Company: “Perhaps the most consequential change is how consumers have become empowered to create their own content about our brands and share it throughout their networks and beyond.” As a result, the company could no longer afford to monitor only “consumer impressions” or measure “how many people would see, hear or read our ad.” Instead, the company needs to track “consumer expressions,” or how consumers actively engage with brand content online: “It could be a comment, a ‘like,’ uploading a photo or video or passing content onto their networks.”

Tripodi’s comments reflect the image of the so-called new consumer that has developed since the 1980s in the literature on marketing (see Cova and Cova 2012). This figure is imagined to be active and demanding, independent and even unruly, and with the dawn of Web 2.0, technologically empowered. This figure could look hardly more different than the one imagined in the company’s 2002 annual report, the cover of which proclaims, “One Billion Down”; inside, the text states, “This year, even as we sell 1 billion servings of our products daily, the world will consume 47 billion servings of other beverages every day. We're just getting started” (The Coca-Cola Company 1998). The statement echoes a remark made in 1996 by then CEO Roberto Goizueta: “We have become increasingly mindful of one undeniable basic fact: The human body requires 64 ounces of liquid nourishment every day. We're the largest beverage company on earth, but our products on average account for less than 2 of those 64 ounces. That is an awesome opportunity for our company” (Edison 1996: 58; see Foster 2008a: 65). In this view of value creation, consumers are passive vessels into which measurably more ounces or servings of product ought to be poured.

Tripodi (2011) himself draws the contrast between the company’s old and new marketing approaches by noting that it was two consumers in Los Angeles rather than company officials in Atlanta who started Coca-Cola’s Facebook page: “A decade ago, a company like ours would have sent a ‘cease and desist’ letter from our lawyer.” Today, however, the company’s response illustrates its acceptance of the principle that “you don't own your brands; your consumers do.” So, Tripodi explains, instead of taking legal action against the two brand fans, “we've partnered with them to create new content, and our Facebook page is growing by about 100,000 fans every week.”

Coca-Cola’s shift in marketing strategy was designed to embrace both the fact that the creative output of consumers (consumer-generated stories) would always exceed that of the company and the hope that the company could encourage consumer creativity “with the right type of content”—namely, content that is “liquid and linked” (Tripodi 2011). The concept of liquid and linked is expounded on in Content 2020, an elaborate and widely discussed fifteen-minute two-part manifesto available on YouTube and narrated by Jonathan Mildenhall, the company’s vice president for global advertising strategy and content excellence (The Coca-Cola Company 2011). By “liquid,” Mildenhall explains, the company means “contagious ideas” that cannot be controlled; by “linked,” the company means ideas that are relevant to the company’s “brands, business objectives and consumer interests.” These ideas will inform the brand stories that the company tells, provoking conversations among consumers, which will spread as an increasingly large “share of popular culture,” thereby generating new liquid and linked ideas to which the company must continually respond.

In effect, Mildenhall outlines a circuit through which the company aims to “leverage existing consumer behaviours,” including consumers’ use of new technologies such as smartphone apps and, of course, social media. Mildenhall calls this circuit “dynamic storytelling”—the dispersal of brand ideas across “multiple channels of conversation” that the company “edits” in order to ensure that the ideas being talked about remain linked in the sense already defined.1 But the company does not merely listen to consumer conversations; instead, it participates as an interlocutor. And it is by means of this participation (for example, through online dialogue) that the company uncovers the “inspirational provocations” that become brand content—“the substance or matter of conversations.”

Content 2020 characterizes the marketing relationship between company and consumers as one of “genuine collaboration”; The Coca-Cola Company and consumers of its branded products partner in co-creating brand content. This relationship is thus not unlike the relationship between the company and a “rock star” advertising agency that the company might hire. Consumers are imagined as one of several possible partners with whom the company develops content. But unlike an advertising agency, consumers can not be hired or fired. “You cannot pay your way to greatness for your brands any longer,” observed Wendy Clark, the company’s head of integrated marketing and communications (quoted in Pardee 2011), hence Tripodi’s (2011) conclusion about an online conversation in which three Coca-Cola Ambassadors traveled the world and blogged about what makes people happy in different countries: “We had to give up control of the content, so our ambassadors could share their own experiences. In an era of consumer expressions, seek to facilitate and participate with [brand] communities, not control them.” Or as Content 2020 puts it, the role of the company’s marketing department is to fuel and guide the ongoing conversation, to “govern the flow” of liquid content. Mildenhall thus fashions himself as a kind of curator, someone who will “inspire the right kind of participation and curate the best-quality content that consumers create” (Walsh 2011).

Mildenhall reported that The Coca-Cola Company has two measures for assessing the success of its efforts at dynamic storytelling. The first of these measures is “brand love”: “we've got a quantitative system that helps—going from not knowing the brand, to accepting the brand, to liking the brand, to loving the brand” (Walsh 2011). Mildenhall implies that the circuit of liquid and linked content, managed properly, promotes a love relationship between consumers and brands. This love relationship, in turn, generates the consumer creativity that drives the production of ever more engaging brand content (see Roberts 2004; Foster 2007, 2008b).

The second measure is “brand value.” Mildenhall notes that moving up or down on the scale of brand love affects brand value, but he does not elaborate (I will discuss this relationship soon). I suggest that his observation, echoed in the epigraph of this section, refers to the idea of value creation associated with the work of the late influential business professor C. K. Prahalad. In 2004, Prahalad and Ramaswamy (2004a: 5) wrote about how the “interaction between the firm and the consumer is becoming the locus of value creation” (see also Prahalad and Ramaswamy 2004b). More precisely, this interaction is the locus of co-creating value; that is, consumers now no longer merely purchase offerings autonomously created by the firm, but instead engage in personalized interactions with the firm with the aim of co-creating products and services that realize highly specific desired outcomes.

More radically, Prahalad and Ramaswamy (2004a, 2004b) saw the roles of production and consumption, of producer and consumer, converging in the co-creation of experiences that deliver unique value to consumers2; that is, these experiences and the interactions that facilitate them necessarily vary from individual consumer to individual consumer. They vary because firms can never fully control or manage how individual consumers will go about the co-creation of their experiences. Firms that pay due attention to such variable co-creation experiences, Prahalad and Ramaswamy (2004a: 13) argue, enable consumers to co-create value that these same consumers are “by design, ‘willing to pay for.’” Such firms therefore put themselves in a position to defend against the commoditization of their products and services. By “commoditization,” Prahalad and Ramaswamy refer to a process by which competition renders price the only issue relevant to consumers; that is, commoditization results in consumers seeking the lowest price possible for products regarded as generic and interchangeable.

In sum, the marketing discourse of The Coca-Cola Company implicitly draws upon what one marketing professor has called the “stakeholder model” of brands (Jones 2005). For the moment, I note that this model suggests that brand value is co-created through interaction with multiple stakeholders. In other words, brand value is the contingent outcome of relationships—ongoing, changing, hardly predictable relationships among the various stakeholders in a brand: consumers, workers, investors, and suppliers, but also media, governments, and NGOs. Paramount among these relationships, from the point of view of marketers, is that between a consumer and the branded product that the consumer buys and uses. In this relationship, the consumer is not a passive purchaser or even a loyal customer, but instead an active agent, a primary source or subject of value creation as well as an elusive object or moving target of marketing strategies.

Translations of value: The work of consumption and the gift model of the brand

The idea that consumers can create value has been embraced by marketing specialists who recognize that far more is at stake in the relationship between brand owners and consumers than what has been understood as customer loyalty. Marketing managers today readily concede that brands are the creations of consumers as much as the products of designers, researchers and advertisers. Consumers now are co-creators or prosumers.

Is there a way to apprehend critically the processes of value creation construed in marketing discourse without losing sight of the claims being made about the role of consumers as partners with the company or even lovers of the brand? I suggest that we look to Marx for help. But we must acknowledge first that the idea of consumption as a source of value creation makes little sense in terms of classical political economy and, in particular, the labor theory of value associated with Adam Smith and Karl Marx. This theory focuses on the labor processes by which value is incrementally added to a commodity over the course of its production and, in Marx’s version, the means by which surplus value is extracted from these processes. It considers only cursorily the question of use-value—the meaningful uses to which consumers put the commodities that they purchase, which I call, after Miller (1987), consumption work. The term has the advantage of conveying, in line with Smith and Marx, that labor and only labor is the source of value.

“Consumption work” refers to the diverse appropriations by which consumers turn impersonal, standard commodities into personal, singular possessions. It is a matter of self-objectification, the activity through which human beings fashion themselves in the external world—the activity that Marx ([1867] 1967) associates with the distinctive human capacity to produce or labor. Miller’s (1988) ethnographic account of a London council estate persuasively demonstrates the argument. Residents of the estate varied greatly in the extent to which they had transformed their plain standard-issue flats; one resident had not even hung a wall decoration, while another had completely remodeled his kitchen in a vaguely medieval style, complete with (painted) beamed ceilings and a faux hearth. Miller’s interviews with residents about their attitudes toward the estate reveal a striking correlation. Residents who felt disaffected with the council and out of place living on the estate were the ones most likely not to have altered their flats—that is, to appropriate the flats as raw material for the expression of their social selves.

Such self-objectification is also familiar in the activities of people who express their attachments to particular brands in the material form of collections. Consider my friend Kathy’s basement (fig. 1). Kathy enjoys drinking Coca-Cola® beverages. She is also a brand fan with an interest in Coca-Cola® material culture that complements her professional work as a museum curator. The things in Kathy’s basement have not only been acquired personally, but they have also been received as gifts from family and friends mindful of her interest. Their display materializes Kathy’s social network. I, too, have been enrolled in this sociomaterial network by giving Kathy a commemorative pin that I picked up at the annual meeting of The Coca-Cola Company in 2011, the 125th anniversary of the famous soft drink. Similarly, my research on The Coca-Cola Company has prompted many friends to offer me a whole array of branded things—from vintage magazine advertisements to contour bottles from Egypt, India, and Croatia—with which I decorate my office.

Figure 1
Figure 1. A view of Kathy’s basement. Photograph courtesy of Kathryn Leacock.

I have elsewhere developed the critical claim that consumption work can indeed serve as a source of surplus value for brand owners (see Foster 2007, 2008a, 2008b, 2011). The claim requires revising Marx’s ([1867] 1967) version of a labor theory of value. Classical political economy distinguishes between the use-value and exchange-value of a commodity. In Marx’s well-known formulation, all commodities have use-value, physical properties that render a commodity of use in various ways; that is, use-value is the material presupposition of exchange-value. However, not all use values have exchange-value—transferable value for others (or social use-value)—and therefore not all use-values are commodities.

This distinction between use-value and exchange-value is practically confirmed in the exchange of qualitatively different commodities, inasmuch as it is in exchange that commodities reveal themselves as the repositories of labor power. It is the relative quantities of labor power, abstracted from the material elements of the commodities, that are effectively compared in exchange. Put differently, the distinction between use-value and exchange-value indicates the difference between the concrete and abstract aspects of all labor. The objectification of the subjective, qualitative, diverse aspects of labor (i.e., concrete labor) is “in all epochs reflected as characteristics of the product in terms of its use-value” (Elson 1979: 147). Marx emphasizes the objectification of abstract labor in commodities, reflected in their exchange-value, because the dominance of the abstract aspect of labor over the concrete aspect is a peculiar feature of capitalism.

For Marx, it is not in the exchange of commodities that surplus value is created. Rather, it is in the use of one particular commodity in the “hidden abode of production” (Marx ([1867] 1967: 176)—labor power—that surplus value is created, for it is the unique use-value of labor power to produce more value than it itself embodies. My claim extends this point: consumption work can be understood as a form of concrete labor that brands objectify; that is, a brand subsumes multiple, private, and diverse instances of consumption work and makes that work available in objective, socially recognized form: the brand and brand-name product. What brands do, in effect, is objectify the heterogeneous consumption work of many individuals, much like a price (denominated in paper money or commodity money such as gold) objectifies (or becomes the value-form of) abstract labor. (The brand’s appearance as an independent entity is therefore a kind of fetishism.) The attraction of the brand for a consumer thus lies in its ability to valorize the consumer’s own consumption work—to render his or her own creative activity intelligible both to the consumer and to significant others. When brands no longer do this—another way of saying when brands are no longer cool—they lose currency. The efficacy of a brand depends on the extent to which consumers use the brand as a medium or instrument of their own “affectively significant relationships” (Arvidsson 2009: 17)—indeed, as a resource for the sort of self-realization that Marx identifies with unalienated labor (see Miller 1987).3

How, then, might use-value enter into the production of surplus value? From the point of view of brand managers, the answer is thought to lie in matching products with the particular needs of consumers. At The Coca-Cola Company, for example, package design has become a strategy for anticipating the uses to which consumers will put products. Consider this comment from Ralph Kytan, vice president of Coke’s North American bottling operations: “There was a time when value was defined as more—more ounces for less [money].” This was presumably the time when consumers were viewed as vessels for accommodating 64 ounces of company products every day. By contrast, “package diversity is about matching up the benefits of the package with the needs of the purchaser for the occasion they're buying for” (Collier 2009). And there are many occasions on which fewer than 64 ounces is appropriate, hence the introduction of stylish 8.5-ounce contour aluminum bottles for consumers seeking smaller serving sizes. In this view of things, the consumer appears as an active agent in a sociomaterial network that the company seeks both to bring into being and to govern.

Put differently, in the new value equation, consumers will of their own accord pay more per ounce for Coca-Cola® products that come in a smaller-size package. The company regards its package designs as an investment in the brand; indeed, the trademarked contour bottle is a brilliant condensation of marketing and packaging. For the most part, the value of the brand would be attributed to similar investments the company has made in marketing, advertising, and quality control. Accordingly, despite the company’s attention to consumer uses, there would be no question for the company as to who owns the brand, and who profits from it.

The anthropology of gift exchange, however, affords a more critical perspective on this commodity transaction. From this point of view, consumers who purchase a Coca-Cola® product because of its use-value—its significance, importance, or fit for their own personal projects—would be in effect buying back their own creative activity in the form of the branded product. Here, we encounter an instance of keeping-while-giving, or what I call the “gift model” of the brand (see Mazzarella 2003 on the gift of the brand). Keeping-while-giving is an idea inspired by Mauss and developed by Annette Weiner (1992); it describes the strategies by which gift givers keep highly valued things such as family heirlooms in their possession by giving away other things. Often, the things given away are less valuable instances of the type of thing that the inalienable heirloom epitomizes. Giving away other objects—replacements—thus functions as a means for defending what is kept; for example, in Samoa, the retention of a fine old pandanus mat is ensured by the distribution of many less-fine new mats. In kula exchange, a Trobriand man retains possession of a large, named shell valuable by engaging in transactions (pokala) involving the exchange of smaller, anonymous shell valuables.

Keeping-while-giving also describes the circulation of branded products, a claim that requires softening the hard analytical opposition between gifts and commodities. The branded product (indeed, the brand itself) is a cumulative outcome of the qualifications of many people, including many consumers (Callon et al. 2002). But the brand itself is an owned asset, its heterogeneous sources submerged in its legally protected and forcefully defended unitary identity; that is, branded products circulate as satellites of the brand—material tokens that consumers purchase and use for their own specific purposes.

In its normal functioning, this arrangement enables consumers to incorporate branded products into their own self-definition—the creative activity or work whereby consumers objectify themselves in the external world. But this normal functioning requires consumers to pay monopoly rent for the use of a brand that has become entangled—through this very creative activity—with their particular biographies and passions. This rent, willingly paid, allows consumers to recapture their own qualifications of the brand/product or at least to retain continued access to them. This rent also then represents the surplus value that brand owners extract from consumption work (see Böhm, Land, and Beverungen 2012).

So, exactly how much is the Coca-Cola® brand worth? What is its exchange-value? The answer to this question requires a means for translating the hetero-geneous concrete labor or consumption work objectified in the brand into a monetary equivalent or price. This translation occurs through brand valuation, the process that paradoxically renders brands—marks of distinction—commensurate not only with each other, but also with all other commodities.

Calculating value: ISO 10668:2010(E), or brand valuation as market device

For purposes of valuation, the ISO (2010: 1) defines a brand as a “marketing-related intangible asset including, but not limited to, names, terms, signs, symbols, logos and designs, or a combination of these, intended to identify goods, services or entities, or a combination of these, creating distinctive images and associations in the minds of stakeholders, thereby generating economic benefits/values.” It is worth pausing to note—as an example of the loop connecting marketing practice with critical social theory—that the ISO definition of a brand seemingly invokes the same stakeholder model that informs Adam Arvidsson’s (2009: 17) definition of a brand as “the affectively significant relationships that a company is able to build [with] its stakeholders, consumers, employees, sub-contractors and the public at large.” Indeed, the ISO definition almost suggests that brands are relational and distributed qualifications in the sense that I, following Callon et al. (2002), have suggested elsewhere (Foster 2008a). Celia Lury and Liz Moor (2010: 32) foreshadowed the ISO’s definition when they wrote that “brand valuation itself is under pressure to explore new dimensions of value and to establish techniques by which the diverse values of a more diffuse set of ‘stakeholders’ can be measured and connected to the strategic and financial interests of shareholders and, increasingly, other stakeholders too.”

News of the ISO standards was greeted enthusiastically by Interbrand, one of the oldest and best-known firms offering brand valuation services. Nik Stucky, Interbrand’s global practice leader for brand valuation, observes that the variation in methods and expertise for brand valuation had created insecurity on the part of companies and hence reluctance to purchase brand valuation services. The ISO standards, he claims, would foster “the development of the service by clarifying best practices and minimizing risk” (Stucky 2010). Accordingly, Interbrand announced in a December 2010 press release that it was the “first brand consultancy in the world to achieve ISO 10668 certification.” Stucky declares in the release that “certification according to this internationally accredited standard underscores our high standards of quality and our outstanding performance, and validates the confidence our clients have placed in us. It is evidence that they can trust the methods we use to determine the financial value of their brands” (Interbrand 2010a). Stucky’s comment, as well as a note in the press release that ISO 10668 was created to “make brand valuation a more respectable enterprise” (Interbrand 2010a), alludes to a history of trials through which brand valuation had emerged victorious. These trials involved beating charges that brand valuation was something of a “black art” (to use David Haigh’s term; see BSI Group 2009)— neither theoretically valid nor empirically verifiable (see Lury and Moor 2010). With ISO 10668, the market device had been stabilized.

Part of the victory won by brand valuation was against the accountants, who could no longer claim a monopoly on asset valuation. ISO 10668 requires that brand valuation consider the legal and behavioral dimensions of brands as well as the financial dimensions. From then on, the accountants would have to share their territory not only with lawyers, but also with the folks from marketing. Stucky (2010) claims that “it is this achievement that makes the new standard so valuable for practitioners and users of the valuation service alike.” Thayne Forbes, a managing director of the brand consultancy Intangible Business, was more to the point. He says in an article for AccountancyMagazine.com that “behavioural aspects are what really sets this standard apart and what accountants should take most note of…. A brand’s core value lies in its ability to communicate with its stakeholders. This emotional engagement should be measured within each stakeholder group by looking at measures of brand strength such as awareness, relevance, perceptual attributes, knowledge, attitude and loyalty” (Forbes 2010). (I will accordingly say nothing about the legal dimensions of brand valuation and little about the financial or accounting dimensions.)

Forbes’ comments remind us that the historical emergence of brand valuation coincides with the much debated transition to a post-Fordist economy in which intangible assets are worth more than brick-and-mortar assets. This transition entailed a search for ways to identify, measure, and exploit new forms of value creation or opportunities for surplus value extraction, such as the consumption work going on in Kathy’s basement. Transaction data were mined to find ways of anticipating and targeting consumer desire, and experiments in co-creation were launched to capture consumer insights and design ideas in the name of supplying consumers with exactly what they want. Focus was trained upon relationships, especially the relationship between consumers and brands, as a source of value— even if these relationships often involved a misalignment of aims and goals (Lury and Moor 2010).

How exactly is brand strength measured? How, in other words, does the market device of brand valuation construct a brand as a set of qualities and translate the qualities so associated with the brand into a monetary figure? Consider Interbrand’s annual valuation of the Best Global Brands. This league table, released to great fanfare every year in partnership with BusinessWeek, is an example of how a market device actively makes a market for itself; that is, the annual ranking both promotes Interbrand/BusinessWeek and creates interest in and legitimacy for brand valuation services. Companies that score high embrace and publicize the results—for example, Joe Tripodi boasts in an online interview at Forbes.com that “for the twelfth year in a row Coca-Cola topped the list of Interbrand’s most valuable brands” (Dan 2012); companies that score low—or that receive no mention—attempt to improve their position. It is a miserable dynamic, depressingly familiar to university academics in this era of audit culture.

Best Global Brands is Interbrand’s annual report on the world’s one hundred most valuable brands.4 The 2011 report includes, in addition to the rankings, a section on industry insights, and short statements on criteria for inclusion in the survey and methodology. The formula for calculating brand value requires first an analysis of financial performance both for a five-year forecast and for beyond, which renders a sum called economic profit. Economic profit is then multiplied by a percentage that represents the “role of brand,” a reflection of the portion of demand for a branded product or service that exceeds what the demand would be if the product or service were unbranded. The result is called branded earnings. Finally, a discount rate, inversely related to “brand strength,” is determined through a proprietary algorithm. That rate is used to discount branded earnings back to a present value “based on the likelihood that the brand will be able to withstand challenges and deliver the expected earnings” (i.e., brand strength) (Interbrand 2011). This calculation expresses brand value in monetary terms—a $US figure. The number one brand in terms of monetary value in the 2011 annual report was Coca-Cola, valued at nearly $72 billion and up 2 percent in value from the year before (see table 1).

TABLE 1. 2011 top ten global brands. Source: Interbrand (2011).
Table 1

While each of the three steps in the calculation of brand value deserves closer examination, I will here consider only (and all too briefly) how brand strength is determined. Interbrand’s brand strength score is based on ten components (revised in 2010 to better reflect the effects of such new market phenomena as social media and corporate citizenship), each of which plays an “equal role in the brand’s ability to generate value” (Interbrand 2011). These components are commitment, protection, clarity, responsiveness, authenticity, relevance, under-standing, consistency, presence, and differentiation. These components almost all pertain to how a brand owner presents the brand to stakeholders and how stakeholders perceive the brand. In other words, brand strength hinges on the nature of the brand/stakeholder relationship—a relationship usually characterized as one of fundamental trust.

By incorporating the behavioral aspects of brand valuation into its requirement, ISO 10668—like Interbrand—foregrounds this relationship between a brand and its stakeholders, among whom consumers are arguably the most important to brand owners. Brand valuation thus acknowledges, if only implicitly, that brands are contingent outcomes of relationships—ongoing, changing, not always predictable relationships. In this sense, brand is like reputation: an interactive social construction. And brand management and reputation management are closely connected corporate concerns. As Interbrand strategist Tom Zara (2009: 3) puts it: “Brand has become even more important in separating the winners from the losers in a marketplace where corporate reputations have been battered by scandals and bruised by recession.” This observation is particularly apt in cases where the brand and the corporate entity are identical: McDonald’s, Disney, and Coca-Cola—all companies in which brand value is estimated to make up more than 50 percent of market capitalization (unlike, say, the case of Proctor and Gamble or Pfizer— companies that own multiple brands with different identities).

Brand and reputation are similar economic objects in another sense. They are both found at the limits of managerial control inasmuch as they involve a company’s external relationships. These external relationships encompass not only the relationship between company/brand and consumers, but relationships with a broad array of stakeholders. Zara (2009) identifies six different fields of stakeholders: employees, customers, suppliers, the communities in which companies operate, the governments that influence operations, and the planet that all companies rely on for existence. The challenge of bringing all these relationships under managerial control is daunting, to say the least. But it is in this very recognition that one can glimpse how brand valuation functions as a market device that breeds more market devices.

Consider how Interbrand represents the field of external relationships, starting with the relationship between brand owners and consumers. Jez Frampton, Interbrand’s global chief executive, writes in the introduction to the 2010 Best Global Brands report:

We are becoming used to a new normal—one where brands are constantly stress-tested for relevance and value…. [Customers] will expect to buy online, return in-store and receive the most up-to-date offers instantly. With alternatives only a click away, their patience is ever-shortening—making them not only more difficult to predict, but more confident every day. Indeed, even what appears to be the most minor instance of customer discontent in one part of a brand experience can quickly lead to a major customer revolt due to consumers’ ability to spread the word about brands quickly and effectively online. (Interbrand 2010b)

Armed with all the resources of online social media, the new consumer appears here as elsewhere: unruly and threatening: “Customers are not only more skeptical due to access to more details, but they can also talk back, providing feedback, criticism and emotional reactions online, with the expectation that brands will be paying attention. The challenge for brands is to respond right away with relevance and sincerity, or else risk compromising the relationship.” Frampton insists to the point of fear-mongering that “it is a risky landscape for today’s brands.”

And that’s just the relationship with customers or consumers. What happens if we consider all six fields of stakeholders? Zara (2009: 3) makes it clear that risk is distributed through all of a company’s external relationships; for example, with regard to business-to-business relationships, “purchasers understand that they can be held accountable by the public for their suppliers’ actions. So pressure that begins externally—in the net’s 24-hour court of public opinion and among a press ready to feed the beast—winds up being passed along every link in the [supply] chain.”

In short, the rhetoric of Interbrand produces the very risk and uncertainty that the firm’s services promise to manage. Indeed, it is not implausible to argue that brand valuation is itself a new form of risk and uncertainty with which companies must deal. Michael Power’s (2007: 150) observation about reputational risk applies as well to brand valuational risk: “Reputational risk is a pure ‘man-made’ risk because it is the product of evaluative institutions which explicitly manufacture a new kind of uncertainty with a high degree of calculative rationalization.” The response to reputational risk, according to Power, is to bring the outside in—that is, to internalize and therefore render manageable the risky external stakeholders whose values and interests must be addressed because they matter in the social construction of reputation. As a result, companies create new market devices to make their “reputations easily readable and auditable by outsiders who are conceptualized as sources of vulnerability and fear” (Power 2007: 150).

It is the proliferation of these market devices—designed to manage the potential challenges to the reputation of a company and its brands—that brand valuation in effect stimulates and rationalizes. Brand valuation thus resembles one critic’s hilarious description of the popular memoir Eat, pray, love: “a self-generating, self-sustaining, self-replicating machine of perpetual self reference” (Anderson 2011). There are, nevertheless, good if not obvious reasons why corporations allow themselves to get caught in the machine of “brandization” (Willmott 2010)—that is, the monetization of brand value. Willmott provocatively argues that in the current era of financialization, corporations invest in branding not in order to extend the market or to increase market share or even to charge a higher premium price; rather, the goal is to leverage the value of the brand for shareholders (for example, through royalties derived from its use by other corporations). Brands therefore become a source of revenue by attracting investors persuaded that brand-owning companies will grow at a faster pace than that of companies without brands.5 Investment increases share price, and thus market capitalization, “against which cheaper lines of credit and the debt-financing of expansion or acquisition activity can be secured” (Willmott 2010: 524). Hence, the dividends and capital gains that accrue to investors as a result of increased share price represent surplus value created and extracted, in Willmott’s (2010: 517) words, “beyond the point of production.”

In sum, brand valuation completes the movement begun by subsuming the concrete labor of myriad consumption workers into the brand; that is, brand valuation translates or gives expression to the value of consumption work by bringing the brand into relation with the universal equivalent of money.6 The exchange-value of brands—their monetary price—is thus realized without the brands actually being bought or sold. It is realized by comparison with both other brands and money. This realization represents the eclipse of qualitatively diverse consumption work—the particularity of Kathy’s basement—by the equivalence of commodities. The brand as an exchange-value is now ready to “take the place of a definite quantity of any other commodity, irrespective of whether or not it constitutes a use-value for the owner of the other commodity” (Marx [1859] 1971: 44, quoted in Elson 1979: 153).

Conclusion: Neoliberal governmentality?

At the end of her incisive essay “The value theory of labour,” Diane Elson (1979) considers the political implications of Marx’s value analysis. She makes two related points—namely, that this analysis enables us to understand “capitalist exploitation as a contradictory, crisis-ridden process, subject to continual change” and that it builds into this understanding “the possibility of action to end” exploitation (Elson 1979: 171). What, then, are the political implications of revising Marx’s value theory and Mauss’ take on gifts to encompass consumption work and brands?

My argument about the creation of brand value through consumption work illustrates how people’s life activities outside the sphere of wage-labor have been harnessed to the interests of capital. Yet, this change in the locus of capitalist exploitation is celebrated in marketing discourse as a surrender of corporate control to the empowered, playful, and innovative new consumer. The paradox is easily dismissed as merely apparent, for these new consumers pose no real threat. In fact, as Zwick et al. (2008: 167–68) observe, such “consumers are the result of strategic corporate practices of consumer government that now operate ‘in an expanded range of everyday spaces’ (Moor 2003: 39).” Co-creation and prosumption, as imagined in Content 2020, for example, signal the rise of what Zwick et al. (2008) call a “new marketing govern-mentality,” a form of power that “acts through practices that ‘make up subjects’ as free persons” (Rose 1999: 95, quoted in Zwick et al. 2008: 165). This governmentality extends even to political and counter-cultural activists whose subversive protests can be folded into marketable (surplus-) value propositions. Resistance is futile.

It would be premature to accept this sobering conclusion uncritically, if for no other reason than that it risks replacing the passive dupes of bygone consumer critiques with active ones—user-consumers blind to their own exploitation because they are too busy enjoying themselves or responding to a discourse that hails them as free and autonomous agents. Indeed, some critics see potential for progressive politics in the “new emerging value logic” of self-organized, user-led systems of production and distribution both online (e.g., Linux) and not (e.g., community-supported agriculture). These systems, it is said, define spaces for non-alienated labor, community-oriented sharing, and “authentic creative expression that is undertaken for the very joy of self-realisation” (Arvidsson 2009: 22).

Consideration of this alternative perspective on the politics of consumption falls beyond the scope of this paper. Its availability, however, suggests that one’s choice of perspective requires an ethnographic and historical account of specific instances of consumer politics (see, e.g., Foster 2008a, 2013). But this choice also requires openness to the possibility that political action might take more than one legitimate form—for example, finding wiggle room for compelling greater corporate account-ability within the existing circuit of governmentality while at the same time directly confronting the premises of capitalist labor exploitation at and beyond the point of production.


I thank Ton Otto and Rane Willerslev for inviting me to the workshop in Cairns where this paper was first presented and for their editorial comments. I also thank the three anonymous HAU reviewers for their helpful comments and Kathryn Leacock for the use of her photograph. The research on which this paper draws has been generously supported by the National Endowment for the Humanities and the University of Rochester.


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Choses à faire avec les marques : création et calcul de la valeur

Résumé : Comment la valeur monétaire en dollar des marques commerciales est-elle calculée et les marques de distinction ainsi paradoxalement rendues commensurables ? Qu'est-ce que ce calcul suppose et permet concernant, selon les termes de Marx, la création de valeur et de plus-value ? Dans cet article, je discute de l’émergence de l'estimation de la valeur des marques comme un dispositif du marché qui a récemment pris de l'importance et s'est standardisée. J'utilise l'enquête annuelle Interbrand/BusinessWeek pour démontrer comment les marques mondiales telles que Coca-Cola ® se voient attribuer une valeur monétaire mesurée avec précision. Cette mesure invite les gestionnaires de marques comme les théoriciens critiques à traiter les usages hétérogènes que font les consommateurs des produits de marque en tant que source de la valeur d’échange des marques et des risques de profits tirés des marques.

Robert J. FOSTER is Professor and Chair of Anthropology and Professor of Visual and Cultural Studies at the University of Rochester. He is the author of Social reproduction and history in Melanesia: Mortuary ritual, gift exchange, and custom in the Tanga Islands (Cambridge University Press, 1995), Materializing the nation: Commodities, consumption, and media in Papua (Indiana University Press, 2002), and Coca-globalization: Following soft drinks from New York to New Guinea (Palgrave Macmillan, 2008). His research interests include globalization, corporations, gifts and commodities, material culture, commercial media, and museums.

Department of Anthropology
University of Rochester
440 Lattimore Hall
P.O. Box 270161
Rochester, NY 14627-0161


1. Editing includes dealing with dissent: “Of course, not every consumer expression will be positive. You have to be part of the conversation so you can set the record straight when you need to” (Tripodi 2011).

2. A product that has use-value to only one person can thus acquire exchange-value.

3. This way of thinking about brands makes plain the importance of ethnography—of identifying and interpreting multiple and diverse instances of consumption work—for both critical theorists of value and corporate managers of brands.

4. In order to be included in Interbrand’s annual report, a global brand must achieve more than a third of its sales outside of its home country and have a visible external market presence.

5. In his prescient book One market under God, Thomas Frank ([2000] 2001: 114ff.) notes that the prophets of market populism in the 1990s exhorted their followers to buy shares in companies with familiar brand names (see also Willmott 2010: 536n21).

6. Willmott (2010) describes this process as the translation of brand equity (recognition, image, personality, etc.) into brand value (cash earnings).